Altering and reselling a product - legal?

[Roccopark]

Hello all, this forum has been interesting reading, and I'm hoping you can help me with what is probably a very simple answer!

If I were to buy an "official" product, alter it, then resell it, would I be infringing on any laws?

To be more specific - if I saw a star wars shirt for instance, but it wasn't available in a small enough size, could I alter it and resell it (and equally if they didn't do plus size, add material to make it larger to resell it).

I've a feeling that if I did that then it would no longer be the original officially licensed product, and therefore I'm effectively selling an unlicensed product.

Edit - could I sell it as "official product altered to 'x'"?

Thanking you hopefully,
Rocco.

[AndyJ]

Hi Rocco,
You pose an interesting question. So long as you only alter and re-sell the original garment then there is no copying so copyright is not involved. Neither is design right which might otherwise protect the design of a garment. And trade mark law is not being infringed because this is effectively a re-sale where the size and shape of the underlying garment are irrelevant. Nor as far as I can tell from what you have told us is there an issue about passing-off. The only time I could see passing-off being an issue might be if you were dealing in high-end branded goods (for instance a Prada Star-wars tee-shirt) where the brand owner might suspect you were actually trading in substandard copies, especially if the machining of the alterations was done to a lower standard than the original, and thus had the potential to damage the reputation of the brand, if your re-worked tee-shirt fell apart too easily. The licensing aspect shouldn't come into it either because since you would have bought the tee-shirt legally, the sale includes a built-in licence for you to wear or dispose of the shirt as you wish.
I'm assuming that you want to do this within the EU. The EU doctrine of exhaustion of rights should even operate if you import grey products into the EU for resale, provided the goods are genuine. In the US, a case called Kirtsaeng caused a brief upset when the lower courts took a more protectionist view on what is know there as the first sale doctrine (largely the same as the exhaustion of rights) where grey imports are involved, but ultimately the Supreme Court reversed the earlier decisions.
So just to recap, I think your proposal is unlikely to fall foul of IP law, but if any high-end brands are involved, be prepared for pressure from their legal departments, based more on their ability to fund expensive litigation rather than because the law is on their side. We have seen certain perfume brands successfully closing down sales of genuine branded perfume on eBay, just because the companies objected to this kind of marketing which they felt damaged the exclusive image of their brand.
Your edit at the end reminded me I should also mention the Trade Descriptions Act which has relevance to how you advertise your products. If you are not buying your shirts from a wholesaler, there may be problems with describing the shirts as 'new', as technically they will have been owned by you before being sold on. This would apply where you were using eBay and have to describe the goods as either new or used. Equally truthfully, 'used' is not a correct description either because nobody will have worn the shirts. Once your business is doing sufficient turnover then you can class yourself as a retailer, and then the new/used dilemma goes away. It may seem like a word you could just avoid, but whether something is new or second hand also has implications for the Sale of Goods Act and other consumer protection legislation. And by altering the garment, you will have most likely voided any manufacturer's warranty and so this will affect the consumer's rights. I don't intend to go into that here because it is some way from the purpose of this forum, but it may be something you want the read up on.

[jackalantern1]

Hi, what an interesting and knowledgeable forum! This is my first post...

I'm sorry to resurrect this thread, but I have a rather similar question that I am struggling to find an answer to... I'm hoping someone here might be able to help me with...

What would be the position if someone purchased an official item, for example a sew-on badge depicting some well know tv or film character, sports person or other such protected image, and then sewed the badge onto a blank t-shirt or jumper to sell? Would that infringe any copyright or trademark, assuming that whoever purchased the clothing knew that only the badge was official?

Another example could be the purchasing of official decals/graphics which are then attached to other items and sold... would this be a breach of copyright?

I hope my questions make sense.

[AndyJ]

Hi jackalantern,

Since you would not be making a copy of the licensed items such as decals or badges, copyright shouldn't come into it.

However there might be trade mark issues if the new goods bearing the decal or emblem were put on sale when there were already licensed goods of the same type on sale in the same territory. The tee shirt example is a good one. If a manufacturer had already obtained a licence to sell tee shirts with, say, a Star Wars logo on, chances are they may have paid for an exclusive licence to make and sell those goods in a particular market like the UK. If you were to obtain genuine Star Wars decals and apply them to blank tee shirts, with the purpose of selling them, this would undermine the value of the licence for the manufacturer. And even if it could be argued that your actions did not infringe the Star Wars trade mark per se, on the basis that you had obtained the decals legitimately, there would certainly be grounds for a passing off action because anyone buying one of your tee shirts would probably be misled as to the official origin of the goods, and your sales would damage the goodwill which might have been built up by the licensed manufacturer.

In some ways this is the reverse of an issue which has cropped up in the courts to do with the appearance of after-market spare parts such as car badges. It is perfectly legitimate for a third party supplier to sell spare parts which may be fitted to a existing vehicle, assuming that they are not being sold as the being from the car maker. However where the appearance of the item requires the car maker's logo to be present (think of something like a bonnet badge) then an interesting situation arises, in that it is argued, the logo is not serving as trade mark, but as a necessary part of the appearance of the the item. This is a problem which the courts have wrestled with on a number of occasions. However with your example, of course there is no requirement for your finished item to resemble anything in particular, yet both components (the tee shirt and the decal, in this case) would be genuine, and it is only when they are combined that a possible problem arises.

I think you would need to make a pragmatic decision, depending on who the intellectual property right is owned by. If the company is known to be litigious and a strong defender of their brands (companies like Disney come to mind) then you would probably be inviting a great deal of hassle by using their intellectual property, whereas other owners may take a more relaxed view.

[jackalantern1]

Thanks for the reply! That was pretty much what I was thinking, but information seems to be fairly scarce on the subject.

My train of thought is that if I buy something that is legitimate, I am allowed to sell that item on. I can't see how I can be prevented from selling it on simply because I have attached it to another item.

Your point about passing off is something that had crossed my mind earlier, but I believe this could be avoided by expressly (and very, very clearly) informing every single potential purchaser that the overall item is not official - and stating what part of the item (e.g. the badge or sticker) is official.

[ancelotcharter]

Hi, I also have a quick question in relation to IP Law in the UK. I am currently a first year law student but I am having trouble finding the exact point of law as I have come across several contradictory views. I am about to launch a gift basket service, aimed at the luxury market in London. I plan on including several well known and established brands - such as Ralph Lauren and Dior. I wanted to know whether or not it is legal to buy the product legitimately from the brand itself and include it in the gift baskets - whilst adding value (other products) and reselling together at a higher price. If it is not entirely legal, should I be considering a partnership with the brands and reaching a formal agreement in terms of what my company will be doing? Thank you so much for your help! I look forward to hearing from you. Best wishes

[ancelotcharter]

Sorry, reading through the feed again - I thought I should clarify that I will not be modifying the purchased product or its packaging from the brand in anyway. It will be resold as and how it was originally purchased by me/my company. Thank you!

[AndyJ]

Hi ancelotcharter

There should be no legal problem with doing what you have outlined. There is no copying involved nor any misuse of trade marks. As for the price you wish to charge for the complete set of products within the basket, plus of course the cost of the basket itself, it is entirely up to you. Retail price maintenance is generally illegal under competition law and so manufacturers are not allowed to impose sanctions on retailers or other middlemen who wish to charge higher or lower prices for their branded goods. However certain manufacturers of luxury brands have been known to misuse the IP protection regimes of sites like Ebay to impede sellers they don't approve of, by claiming the goods being offered are counterfeits. To guard against any interference of that sort, be careful about where you source the items for your baskets and keep good records.

[Grey1092]

Hi apologies for reviving this thread once again but I have a question also. I'm planning to buy standard black joggers and customise them myself by sewing patches on them using material taken from designer bags such as Dior. I was planning on listing these items as "Custom joggers" and stating that I am by no way affiliated with any of the brands used. If I sell these clearly stating that they aren't authentic and are custom made will there be any legal issues facing me? I've had very mixed responses so far with some people saying that it's too risky and some saying that if I state they're all custom made and that I'm not affiliated with the brands I'll be fine under the first sale doctrine, but I honestly have no clue hence why I'm asking. I've seen many people selling custom Nike trainers with designer prints stitched to them and wondered how they had no issues. Thanks in advance.

[AndyJ]

Hi Grey1092,

We need to differentiate between the legal position and the likely reaction from the brand owners.

Legally, I think that so long as you use material taken from genuine Dior etc articles and apply it to the joggers, this falls within the exhaustion of rights or first sale doctrines, and therefore would not be infringing as far as copyright is concerned. However if the material features a registered trade mark belonging to Dior etc, then re-purposing it for commercial purposes would amount to trade mark infringement, or possibly passing off. While a disclaimer might help defeat a passing off claim, it won't prevent a claim for trade mark infringement from succeeding. I assume that you want to use material which is recognizably Dior etc in origin, and given that the high end fashion manufacturers apply their branding liberally to their products, the trade mark issue is likely to be the main problem.

Turning to the brand owners' reactions, once your product comes to their attention, I think you would face considerable pressure to desist, irrespective of the strength of your legal position. This is because the brand owners are keen to protect the reputation and desirability of their brand and will go to some lengths to eliminate anything which dilutes that brand identity. They are likely to subject you to a lengthy and possibly expensive process of threats and pressure to cease and desist, especially if your products become successful economically. If you sell through places such as Ebay, they will use the Verified Rights Owner (VeRO) process to get your items de-listed and possibly have your account disabled. They can afford to employ legal teams to do this, and this can be intimidating and worrying for a small business. If you look at the motivation for your proposed plan from the outside, you can see that in choosing to use recognizable pieces of material from a brand you are, to some extent, exploiting the cachet and aura which is associated with the brand. This is why your products might appeal to your customers: they also want to appear to be associated with the brand. This is the essence of why the tort of passing off exists.

[PsycDuck]

Hello,

I want to buy some bedsheets that have characters on from children's TV shows (Winnie the Pooh) and rework them into clothing and sell them at events. Is this legal in the UK?

If it is legal, are you able to give me documents that support this.

[AndyJ]

Hi PsycDuck,

You might want to take a look at this thread as it covers a similar question to the one you've asked. This saves me having to go over all the details again here.

However the short answer is that you would not infringe the reproduction right which forms part of the copyright in the artwork printed on the sheets merely by cutting them up and re-purposing them. However there is another element to copyright which is known as the distribution right. As its name implies this is the right of the intellectual property owner to control how an article is made available to the public. It usually affects things like the different territories in which items may be sold and is often used to prevent the importation of grey goods, that is to say genuine goods which are sold in one country at a lower price, then being sold on at a similarly low price in another territory where the official goods are sold at a higher price. But the right is limited by something called the exhaustion of rights doctrine. Simply put, this says that once an item subject to copyright has been lawfully acquired by a customer, the rights owner loses all distribution rights in that item and cannot prevent the new owner from selling or giving away or destroying the item which is now his property. This would apply to you once you had legally purchased the sheets.

You asked for some documentary evidence to back up this explanation. Perhaps the clearest explanation is given in this Wikipedia article. However since Wikipedia is not an authoritative source on the law, we need to go to the EU Directive (Directive 2001/29/EC ) which deals with the matter in Article 4(2). Unfortunately, as you can see, the Directive states the doctrine in a complicated manner. Since the UK is no longer a member of the EU we need to be sure that this legal doctrine still applies here after Brexit. This is covered in the Intellectual Property (Exhaustion of Rights) (EU Exit) Regulations 2019.

I hope that re-assures you.

[PsycDuck]

Thank you so much for the information, that has made it really clear and I appreciate the help!

[renicia]

Hello!

Sorry for reviving this post once more but I am not sure if I have all the right information to make up my mind on this matter.
If a person is buying socks from let’s say Nike and then dyeing them in a different colour, no other alterations be made in shape etc. And then reselling them. Would that be copyright infringement? Would this be possible without ask permission from the original brand itself?

Thank you in advance for your help!

[AndyJ]

Hi renicia,

A pair of socks, along with most ordinary, functional clothing*, is not subject to copyright. So altering some socks and re-selling them would not infringe copyright.

Also, I don't think it would infringe design right which is the main right applicable to clothing because you would not be copying the design, merely altering its appearance.

Neither trade mark law nor the common-law tort of passing off would apply because you would be dealing in genuine products from the particular manufacturer. To avoid any chance of a passing off claim, it might be worth highlighting the fact that the change in colour was not authorised by the manufacturer.

However, although I can see no legal objection to doing what you suggest, I think you might well expect some adverse reaction from the major brands such as Nike if your products were successful. For example if you were selling your socks on Ebay, the manufacturer might use the VeRO system to get your items delisted by claiming that they were fakes. Due to various consumer protection laws such as the Sale of Goods Act, I don't think you would be able to sell these items as 'new', even though they had neve been worn by anyone. It would be best to just avoid saying anything about that aspect when you describe the goods in advertising.



* Some high-end fashion garments can sometimes be subject to copyright in the UK if they can be classed as artistic works. Objectively viewed, they need to have the quality of art and the designer must have primarily intended them to have an artistic quality, with the functional quality being merely incidental. Secondly, a piece of clothing which was made entirely by hand and was not mass-produced might qualify as a work of artistic craftsmanship, again provided that a reasonable degree of skill on the part of the maker was present in the work.